Snortland v. State

2000 ND 162, 615 N.W.2d 574, 2000 N.D. LEXIS 172, 2000 WL 1199441
CourtNorth Dakota Supreme Court
DecidedAugust 23, 2000
Docket20000025
StatusPublished
Cited by17 cases

This text of 2000 ND 162 (Snortland v. State) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Snortland v. State, 2000 ND 162, 615 N.W.2d 574, 2000 N.D. LEXIS 172, 2000 WL 1199441 (N.D. 2000).

Opinion

KAPSNER, Justice.

[¶ 1] Howard Snortland appealed from a summary judgment dismissing his action against the State for breach of an employment contract. We conclude Snortland’s *576 action is barred as a matter of law by the six-year statute of limitations, and we affirm.

I

[¶ 2] The underlying facts are undisputed. Snortland served as superintendent of the Department of Public Instruction (“Department”) from January 1, 1977, through December 31, 1980. As superintendent, Snortland was statutorily required to serve as a member of the Board of Trustees (“Board”) of the Teachers’ Fund for Retirement (“Fund”). See N.D.C.C. § 15-39.1-05 (1980). During his term of office, Snortland received payments designated by the Legislature as “annual salary” in the amount of $22,500 per year. As an elected state official, Snortland also received payments designated by the Legislature as “state officer’s expense payments,” commonly referred to as “unvouchered expense payments,” in amounts established by legislative appropriations.

[¶ 3] Snortland was qualified to participate in the Fund because he was the Department’s superintendent. Snortland was eligible to receive retirement benefits from the Fund using a formula based on his “monthly salary,” defined as “one-twelfth of the annual salary paid.... ” N.D.C.C. § 15-39.1-10(2X1980). Assessments representing Snortland’s contributions to the Fund were deducted from his monthly salary during his term, and were paid quarterly by the Department to the state treasurer along with the Department’s contribution. N.D.C.C. § 15-39.1-09 (1980). While Snortland served as superintendent, the Department reported his salary to the Fund as the amount designated as his annual salary. Snortland’s W-2 forms for tax years 1977 through 1980 showed only those payments designated as annual salary were reported to the Internal Revenue Service (“IRS”). Snortland, however, reported as taxable income for state and federal income tax purposes his annual salary and the un-vouchered expense payments he received.

[¶ 4] Snortland’s earnings statements showed deductions for retirement were withheld from his monthly salary. The Fund’s records showed no additional assessments or contributions were made to the Fund based on Snortland’s unvouch-ered expense payments.

[¶ 5] The Board met in September 1980 and discussed whether unvouchered expense payments received by a school superintendent in addition to his salary reported for income tax purposes could be included in salary for retirement benefit calculations. The Board members and executive secretary agreed only salary reported for IRS purposes should be used as income for Fund purposes, but decided to investigate further before taking final action. The executive secretary requested a legal opinion from an attorney, who responded by letter that, based on the North Dakota Supreme Court’s decision in Walker v. Omdahl, 242 N.W.2d 649 (N.D.1976), “unvouchered expenses would not be subject to assessment for the purposes of the [Fund].” In December 1980, the Board adopted the attorney’s recommendation, but Snortland did not attend the meeting.

[¶ 6] Snortland’s 1980 reelection bid for superintendent of the Department was unsuccessful, and he decided to retire when his term expired on December 31, 1980. Snortland submitted his application for retirement benefits to the Fund in January 1981, and the Fund calculated his retirement benefits based on his annual salary alone. The Fund sent Snortland his first retirement check in February 1981 and correspondence informing him of the assessments and contributions that had been credited to his account.

[¶ 7] Snortland believed, even before taking office as superintendent of the Department, that unvouchered expense payments made to state-elected officials constituted salary. Before his retirement, a Department employee told Snortland his retirement benefits would be based on his *577 statutory salary and would not include un-vouchered expenses. After Snortland’s retirement in 1981, the Board’s executive secretary also told him his retirement benefits would be based on his annual salary alone. Snortland admitted it remained his opinion, after discussing the issue with the Department employee and the Board’s executive secretary, that he was not “treated fairly” by being paid retirement benefits based solely on his annual salary. Snort-land also said he “griped about it” to other persons during the 1980s.

[¶ 8] After discussing the matter in January 1998 with a person described by Snortland as a pension and benefits expert, Snortland brought this breach of contract action in August 1998 against the State through the Department and the Fund. Snortland alleged, in addition to benefits he has received since his retirement based on payments to him designated as annual salary, he should also have been entitled to receive retirement benefits based on his unvouehered expense payments. Snortland contended the Department breached his employment contract by failing “to properly and accurately report [his] compensation to the appropriate state agency responsible for determining and paying the retirement benefits,” thereby “depriving [him] of his legal and proper retirement benefits.... ” The State raised the affirmative defense that Snortland’s action was barred by either the three-year statute of limitations under N.D.C.C. § 28-01-22.1, or the six-year statute of limitations under N.D.C.C. § 28-01-16.

[¶ 9] The trial court granted the State’s motion for summary judgment, concluding as a matter of law that Snortland’s action was barred by the six-year statute of limitations under N.D.C.C. § 28-01-16. Snortland appealed.

II

[¶ 10] Summary judgment under N.D.R.Civ.P. 56 is a procedural device for properly disposing of a lawsuit without trial if, after viewing the evidence in the light most favorable to the non-moving party, there are no genuine issues of material fact or conflicting inferences which can reasonably be drawn from undisputed facts, or if the only issues to be resolved are questions of law. Dan Nelson Const., Inc. v. Nodland & Dickson, 2000 ND 61, ¶ 13, 608 N.W.2d 267.

[¶ 11] The statute of limitations for a breach of contract action is six years after the claim for relief has accrued. N.D.C.C. § 28-01-16(1). The discovery rule, which determines when the claim accrues for purposes of computing limitations, applies to a breach of contract claim. Wells v. First American Bank West, 1999 ND 170, ¶¶ 10-11, 598 N.W.2d 834. The discovery rule postpones a claim’s accrual until the plaintiff knew, or with the exercise of reasonable diligence should have known, of the wrongful act and its resulting injury. Id. at ¶ 10. An objective standard is used for the knowledge requirement of the discovery rule, which focuses upon whether the plaintiff is aware of facts that would place a reasonable person on notice a potential claim exists, without regard to the plaintiffs subjective beliefs. BASF Corp. v. Symington, 512 N.W.2d 692, 695 (N.D.1994).

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Cite This Page — Counsel Stack

Bluebook (online)
2000 ND 162, 615 N.W.2d 574, 2000 N.D. LEXIS 172, 2000 WL 1199441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/snortland-v-state-nd-2000.